Keeping the Economy Moving
BY A. JEFFREY ZAPPONE, CTP, APRIL GUEST EDITOR
A. Jeffrey Zappone, CTP, is
a senior managing director
at Conway MacKenzie Inc.
He has more than 20 years of
experience in restructuring,
reorganization, and turnaround
management. He has advised
debtors, creditors, customers,
secured and unsecured lenders,
and creditor committees in
both formal and informal
environments in a wide range
of industries, and has served
as financial advisor, CEO, CRO,
and CFO to underperforming
companies in transportation,
and service industries.
Pilots, drivers, and captains navigate air, land, and sea to ensure the proper flow of goods in our global
economy. Whether for just-in-time
inventory at the plant or that last-minute holiday gift at home, businesses,
governments, and consumers rely on
transportation services on a daily basis.
And, concurrently, the transportation
industry relies on health and activity
levels of producers and consumers.
While manufacturers may be the heart
of the economy, the transportation
industry is the circulatory system;
one is just as critical as the other.
In this issue of the Journal of
Corporate Renewal we offer insight
into the ever-changing transportation
industry, examining topics that we
hope will provide familiarity with
the industry that can be leveraged
in the restructuring environment.
The Great Recession brought many
companies to their knees, and
businesses in the transportation industry
were certainly no exception. Standard
practices such as cost reduction, fuel
surcharges, and pricing negotiations
were implemented to mitigate losses. But
what else can companies do to mitigate
future policy and economic risk?
Future fuels, recent safety regulations,
and even flying drones are issues
discussed by my colleague Timothy
Stallkamp of Conway Mackenzie Inc.
as he explores the current challenges
and changes facing the marine, rail,
and trucking transport environments.
Foreign maritime shippers facing
financial woes have filed Chapter 11
cases in U.S. Bankruptcy Court, seeking
protections that may not be available to
them in their local jurisdictions, many
of which mandate liquidation as the
only remedy available to financially
troubled companies. Given U.S. courts’
willingness to accept cases, these types
of filings are not uncommon. Timothy
A. Davidson II and Joseph Rovira of
Andrews Kurth discuss recent cases,
applicable governing law, and outcomes
of foreign maritime shippers filing
for bankruptcy in the United States.
Would you want unexperienced drivers
behind the wheels of your company’s
trucking fleet? The same question should
apply to those steering financial and
operational turnarounds. Greg R. May
of Car Delivery Network Inc. discusses
the importance of understanding the
trucking industry, a company’s strategic
value, the status of its relationships
with creditors/customers, and the
competitive landscape when developing
and executing a successful turnaround
strategy for a trucking company.
Much attention goes to the financial
and operational aspects of a turnaround,
but what about the legal aspects? Mark
A. Scudder of Scudder Law Firm P.C.
discusses how sound legal planning
and proactive action can provide a
clear runway for restructurings to take
flight. He examines two case studies
involving trucking companies in which
coordinated efforts between financial,
operational, and legal professionals
generated successful turnarounds. J